The European Bank for Reconstruction and Development (EBRD) has revised its 2017 economic growth forecast for Georgia and said that the country’s economy in 2017 as well as in 2018 will experience a faster growth than previously expected.

The revised forecast from the EBRD says that Georgia’s economy will grow by 4.5 percent in both 2017 and 2018. Compared to the previous forecast released in May, this is a 0.6 percentage point improvement for 2017 and 0.3 percentage point improvement for 2018.

"The economy of Georgia is accelerating on the back of strong export performance and burgeoning tourism. In the first half of 2017, GDP growth picked up to an estimated 4.5 percent year-on-year following two years of below-3 percent growth in 2015-16”, the revised report said.

It added that the Georgian lari appreciated by approximately 6.7 per cent against the US dollar until mid-October 2017, supported by foreign exchange inflows from increased exports, tourism receipts, tightening of monetary policy, and a recovery in remittances which increased by approximately 19.7 percent in the first nine months of 2017.

EBRD stressed that inflation gained pace to 6.2 percent year-on-year in September 2017 from an average of 2.1 percent in 2016. It added that the fiscal deficit is planned at around 4.1 percent of GDP in 2017, reflecting relatively high infrastructure spending financed mostly by borrowing from international financial institutions on favourable terms.

"A recovery in consumption, investment in infrastructure and strong performance of the hospitality sector are expected to contribute to growth”, EBRD said.

The Georgian Economy Ministry welcomed the revision of the economic growth forecast for Georgia and stressed that according to the latest estimations by many international financial institutions, Georgia will enjoy one of the fastest economic growth among the Eastern and Central European and Central Asian countries in the years to come.

The ministry also said that the improvement in the forecast is linked to the recent significant increase of export and growth of tourism. It added that in the first nine months of 2017, Georgia’s economy grew by 4.7 percent. In the same period, export grew by 28.3 percent while the income received from tourism increased by 28.5 percent.